) provided a robust outlook for the first quarter 2014 as well as
boosted its 2014 bottom line expectations resulting from higher
wholesale electricity prices owing to cold winter weather and
limitations of pipeline infrastructure in the Northeast US.
Investors reacted positively to the news pushing stock prices by
1.4% to close at $71.97 on Apr 15, 2014.
This utility company now expects its first quarter operational
earnings to be about $2.28 per share, exceeding the Zacks
Consensus Estimate of $1.17 and significantly higher than the
year-ago profit of 94 cents. On an as-reported basis, Entergy
expects $2.23 of profit for the first quarter.
For 2014, the company raised its bottom line outlook to
$5.55-$6.75 from its previous expectation of $4.60-$5.40.
Entergy, whose fourth quarter 2013 earnings fell 41.9% year over
year primarily due to higher total operating expenses and an
increase in shares outstanding, now registered improved results
in the first quarter in both of its divisions - Entergy Wholesale
Commodities and Utility.
Entergy is well positioned through its geographically-diversified
mix of regulated and merchant operations. The company's regulated
assets are located primarily in Arkansas, Louisiana, Mississippi
and Texas, and its merchant generation assets are situated mostly
in New York, Massachusetts and Michigan. This insulates Entergy
from regulatory bottlenecks and power-price volatility in any
particular region, helping the company to achieve its targeted
annual compound earnings growth of 6% in the next five years.
The company is slated to report its first quarter earnings on Apr
24, before the opening bell. We remain optimistic for Entergy's
cost-control initiatives that are expected to boost its upcoming
margins and improve operational efficiency.
The company plans to realign its operations to optimize its
resource-utilization in order to meet the changing business
needs. Entergy has set forth a cost saving target in the range of
$200 million to $250 million via its human capital management
program to be implemented by 2015 end.
Entergy currently has a Zacks Rank #2 (Buy). Some better-ranked
stocks in the same industry include
Public Service Enterprise Group Inc.
NRG Energy, Inc.
NRG Yield, Inc.
). All these stocks sport a Zacks Rank #1 (Strong Buy).
ENTERGY CORP (ETR): Free Stock Analysis
NRG ENERGY INC (NRG): Free Stock Analysis
NRG YIELD INC-A (NYLD): Free Stock Analysis
PUBLIC SV ENTRP (PEG): Free Stock Analysis
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